Social Media

Yelp By the Numbers: 61 Million Visitors a Month, $58 Million Revenue

Yelp opened the hood on its financial operations on Thursday, giving potential investors a look inside the company's business.

In a prospectus filed with the SEC ahead of its planned IPO, Yelp revealed the company is not yet profitable, but has exhibited strong growth over the past year or so. Among the highlights:

Yelp had 22 million reviews on its network in September, an increase of 66% over the comparable period in 2010. The average review has more than 100 words.

The company's website got 61 million unique visitors that month, up 63% over the year-ago period.

Five million mobile devices accessed Yelp in September.

There are 529,000 business locations that are on Yelp, up 114%.

The company posted $58.4 million in revenue for the first nine months of this year, up 80% over the comparable period in 2010.

Yelp posted a net loss of $7.6 million for that period.

The bulk of Yelp's revenues — $40.3 million for the first nine months of 2010 — comes from local advertising. Another $12.7 million is from brand advertising, while the remainder — $5.4 million — is from "other services." This includes the recently scaled back Yelp Deals offering.

Sales and marketing comprise $38.5 million of Yelp's expenses.

Though the company warns it has "incurred significant operating losses in the past" and may not be able achieve or maintain profitability down the road, Yelp sees a strong opportunity in local advertising.

The company cites figures from BIA/Kelsey stating that local online advertising was a $19.6 billion business in 2010 and there are 27 million local businesses in the U.S. The implication is that Yelp has plenty of opportunity in the market to scale up.

Yelp cites a few factors in its favor, like the fact that online reviews are gaining credibility and that more local businesses are advertising online. The continuing adoption of mobile devices also benefits the company since so many mobile users are accessing Yelp to get reviews of local businesses on the fly.

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